Glossary

General Glossary

T

TARGET 

Decentralised real-time gross settlement system for the euro, made up of national real-time gross settlement systems, the European Central Bank payment mechanism and the interlinking mechanism.

TARGET2 

A system for making large payments in euros, belonging to the European System of Central Banks. Conforming to the principle of subsidiarity as established in the Treaty of the European Union (EU), it is a decentralised system based on the interconnection of the payment systems in each country. It is a real-time gross settlement system, as a result of which payments are settled one by one, without prior clearing (gross settlement), as payment orders are received (in real time) and with immediate finality, once they have been settled. For the system to work, paying institutions must have a previous balance in their account with the corresponding central bank, or that the latter must grant it the necessary credit, backed by the appropriate guarantees. The TARGET system was developed with the triple objective of: Providing a safe and reliable mechanism for the real-time gross settlement of euro transactions, increasing the efficiency of cross-border payments within the euro area, and, above all, to provide a safe and dynamic vehicle for the implementation of the single monetary policy. As such, all monetary policy operations carried out by the central banks of the states that form the Economic and Monetary Union (EMU) are channelled through TARGET. On the other hand, this system is open to any type of payment made in euros, whether relating to the money markets or trading operations, also including the euro leg of currency transactions, basically euro/dollar and euro/yen. It is important to add that, in principle, all EU central banks and not only those that are part of the EMU, can connect to the TARGET system in order to settle euro transactions. Under the decentralised TARGET system, participants, who as a general rule have to be credit institutions, continue to hold their accounts in national central banks. Domestic operations continue to be settled in the relevant central bank. In terms of cross-border payments between EU countries, these are channelled through the central banks corresponding to the paying institution to the institution receiving the payment. To do this, all central banks are connected with each other and with the European Central Bank, forming what is called the interlinking mechanism or network (interlinking being a term which designates both the infrastructure and the connection procedures). On 24 October 2002, the Governing Council approved the development of TARGET2, which became operational in November 2007. The system's basic services are broader and more homogeneous, and there is a single pricing structure for both domestic and cross-border services. The objectives of TARGET2 are: To better satisfy the needs of users by providing a broadly harmonised service, improving cost efficiency and being able to adapt to future developments, including the enlargement of the EU and the Eurosystem.

Telephone banking  

A banking operating procedure wherein the telephone is used as a marketing and communication instrument with the customer. Therefore, it does not require the physical presence of the customer at a branch to make consultations and formalise transactions, as these can be performed by phone. Access to the service is via a telephone number provided by the entity. Customers can only access their data by proving their identity by means of a password or access code which the entity provides on signing up for the service.

Term repurchase transaction 

Transaction wherein the owner of the securities sells them and undertakes to buy them at a fixed price, on a certain intermediate date between that of sale and redemption. The sale of securities temporarily acquired through this type of transaction is limited to performing reverse transactions, the maturity of which does not exceed the maturity date of the first transaction.

Term transaction 

In the case of the Spanish government debt market, an outright transaction involving the transfer of an asset when five working days have elapsed since the trading date.

Thermochromic pigments and dyes 

Dyes whose colour changes with temperature (for example, liquid crystal dyes).

Third parties 

Participants in the quoted public debt market, whose holdings are entered in the securities register of a management institution.

Third-party account 

For each managing entity, the global register of government debt balances, the exact balancing entry, at all times, of the balances held therein by non-own account holders who have chosen it as their register.

Tilt effect 

The perceptible change in an image or object in terms of brightness, colour or content, on changing the direction of observation or light angle.

Time deposit  

A deposit contracted for a specific period of time. When stipulated in the contract, the amount of the deposit can only be recovered before the period expires with the authorisation of the financial institution and with a penalty in its remuneration. In a broader sense, this term also covers some non-marketable financial assets, such as non-marketable deposit certificates. Time deposits of up to two years are included in the monetary aggregate M2 (and therefore in M3), while those deposits of more than two years are included in the longer term financial (not monetary) liabilities of the Monetary Financial Institutions (MFI) sector.

Tinte del papel 

Color del papel.

Trade bills  

Negotiable instruments which can be collected (if credited) or must be paid (if debited) on maturity. They can be bills of exchange, commercial papers, etc.

Transaction 

A trade agreement, especially for buying and selling.

Transfer 

A movement of funds ordered by a client from his/her account to that of a beneficiary (in the same or another banking institution). This transaction usually involves the collection of a commission by the institution.

Transparency 

Transparent quality. In banknotes, public security features such as the watermark and the see-through register can be properly examined through transparency (against the light).

Traveller's cheque 

A cheque issued in a foreign currency which may be converted into cash in that same currency in another country, upon verifying the signature and identifying the holder. Given its high liquidity, it is an alternative to credit cards for travelling without the risk entailed by carrying large amounts of cash.

Treasury bill  

A short-term fixed income security (from 3 to 18 months) issued at discount, therefore its acquisition cost is lower that the amount the investor will receive at the time of redemption. The difference between the redemption value of the bill and its acquisition cost will be the interest or yield generated.

Treasury bond  

A financial instrument or fixed-income security issued by the Treasury with a maturity of more than five years, with regular interest payments (called coupons), as opposed to Treasury bills, in which case interest is paid on maturity. The typical issuance terms are ten, fifteen and thirty years.

Truncation 

This entails the possibility of replacing original documents with electronic records in order for collection to be made through payment systems. In particular, it is a procedure by which the institution holding a document sends the relevant information in this regard to the drawee bank, without it being necessary to send the "truncated" original document in order to carry out the transaction. Documents such as cheques, current-account promissory notes and direct debits can be truncated, where these are issued for an amount equal to or less than the designated "truncation limit".

Typography 

Printing technique that uses a printing form with a relief image, which is inked and transferred to paper. The numbers of valuable documents are often printed using typography.